Section 8 Company Registration In Tamil-Nadu

Section 8 company is a company which registered as a Non-Profit Organization. The objective of these companies is to promote the fields of arts, commerce, science, research, education, sports, charity, social welfare, environment protection and other similar activities.
A non-profit organization can be registered under the Registrar of societies or as a Non-profit making organization under the Section 8 Company of the Company Act, 2013.
Section 8 companies were previously defined under Section 25 of Companies Act, 1956 with almost the same provisions. The new companies Act, 2013 prescribed more objectives that Section 8 companies can have.
These companies use their all income or profit towards the furtherance of their objectives and did not distribute as dividend amongst its shareholders.

An individual or group of individuals can register as Section 8 Company in Tamil-Nadu, if it has the following mentioned characteristics:

1. The objective should be of charitable nature. It should not intent to make profit for its shareholders.

2. If the company intends to promote science, commerce, education, art, sports, research, charity, social welfare, protection of the environment, or other similar objectives.

3. If the company has the intention to use their all income or profit towards the furtherance of their charitable objectives.

• In Tamil-Nadu, section 8 company members have the limited liability and their personal assets will not be used for the purpose of paying companies debts.

• There is no minimum capital requirement to register section 8 company in Tamil-Nadu.

• In Tamil-Nadu, Section 8 companies have more credibility in compared to NGOs, Trusts and Societies as they are recognized by the Central government’s license.

• Section 8 companies have very less compliance as compare to any other entities in Tamil-Nadu.

• It has perpetual existence and separate legal status from its members.

• It does not have to pay stamp duties and any other high fees at the time of registration.

• Section 8 companies does not suffix the words “Limited” “Private Limited” like other entities.

• Section 8 companies get many tax exemptions.

• Director Identification Number (DIN)

• Digital Signature Certificate

• Passport size Photo of directors

• Id Proof of members (Aadhar Card, Pan Card, Passport, Voter ID).

• Details of Director

• Address Proof of directors (Bank Statement, Mobile Bill, Electricity Bill, Telephone Bill)

• Address Proof of registered place of business (Utility Bill, Rent Agreement, and Proof of Ownership)

• NOC from owner (in case office is rented)

• Memorandum of Association (MOA)

• Articles of Association (AOA)

• STEP 1:

  In Tamil-Nadu, it is mandatory to apply for Digital Signature Certificate (DSC) for every shareholder and director of the Company.

• STEP 2:

  In Tamil-Nadu, after acquiring the DSC, the applicant should apply for the Director Identification Number.

• STEP 3:

  Next, the members have to make an application to ministry of corporate affair for reserving the name of the proposed company in part-A of SPICe+ form. The names applied should be unique and does not go against any provisions mentioned in the act. In this form you can file for two proposed names, if the proposed name will get reject then you can file again with two new names within a 15 days from the date of rejection in Tamil-Nadu.

• STEP 4:

  In Tamil-Nadu, once the desired name is approved, it will be valid for 20 days only. Therefore the applicant needs to file the required application form for incorporating its company within the 20 days. The application must be filed through SPICe+ Form.
  You need to submit the following documents as attachments in SPICe+ form:

  • Copy of MOA duly signed by all members and witnesses

  • Copy of AOA duly signed by all members and witnesses

  • Copy of AOA duly signed by all members and witnesses

• STEP 5:

  After verifying, the Registrar of Companies will issue the Incorporation Certificate if no objection was raised and the business can be commenced in Tamil-Nadu.

• STEP 6:

  In Tamil-Nadu, once the incorporation process is done members can open a Bank account on behalf of the business for any transaction.

In Tamil-Nadu, the 80G Certificate allows an individual a fully or partially tax deduction on donations made to a charitable organization or the Section 8 Company. There is a maximum deduction allowing criteria, if the amount donated exceeds 10% of the total gross income of an individual, then the excess amount will not qualify for tax benefits.

WHO CAN AVAIL TAX SAVINGS UNDER 80G?

In Tamil-Nadu, an individual who make donation as per certain prescribed rules is entitled to avail tax exemption under the 80G.
Donations that are made to a listed charitable trust and organizations only qualify for deduction u/s 80G.

WHO CANNOT AVAIL THE BENEFITS OF TAX SAVINGS UNDER SECTION 80G IN Tamil-Nadu?

• In Tamil-Nadu, if the donation is made to a foreign trust, you cannot avail for tax saving under section 80G.

• In Tamil-Nadu, the deduction cannot be claimed if the donations are made by anyone to one or more political parties.

• In Tamil-Nadu, the deduction cannot be claimed for printing or publishing brochures, flyers, and pamphlets.

• In Tamil-Nadu, donations by NRI if made to qualified institutions and trusts also qualify for tax exemptions under section 80 G.

• In Tamil-Nadu, if the donation is made from salary and if the donation receipt is under the name of the employer, then employees can claim under Section 80 G.

In Tamil-Nadu, section 8 companies, trusts and NGOs that get itself registered with 12A, can avail the benefits of getting exemption from paying income tax on their surplus income or profit. NGOs are an organization which works for charitable and non-profit activities. But as they earn income or profit, and if not registered themselves under section 12A of the Income Tax Act, they will have to pay the tax on regular tax rates.

1. Trust Deed, Registration Certificate of the Trust or NGO and MOA of a society

2. Certificate of Incorporation and copies of MOA and AOA of Section 8 Companies

3. Form 10A

4. PAN Card of the Organization

5. Bank Statement of previous three year.

• In Tamil-Nadu, The main benefit of 12A registration is the income tax exemption benefit concerning income utilization.

• In Tamil-Nadu, Organization registered under Section 12A, is eligible to receive grants from Government, Abroad and various private sectors.

• In Tamil-Nadu, Entities registered under 12A are also eligible for availing benefits under Section 80G.